January 27, 2010

Treading the Muddy Waters of Corruption

People often ask me how I manage to keep my "no corruption" stance in an environment in which corruption is the rule and not the exception.

1. My first strategy is to "sell" this concept to my staff.

Most people from this country are accustomed to business being done in a corrupt way. Even when they don't like it or agree with it, they often go along with it just because the alternative seems too hard. The way I sell it is by example; and over time, they see the benefits of the strategy. For instance, taxation officers tend to drop by on Friday afternoon and threaten to seal the office if they are not given their "weekend allowance." We simply say no and agree to be shut down. Others who fall into the trap do give the "allowance." Sure, the tax officer who received the gift will not come back for a few weeks but he will send the word out to his colleagues and they will visit one at a time to get their piece of the pie. In our own case, after a few times of not getting anything, they simply stopped coming. They really don't bother us anymore.

There are many other examples too of employees seeing that a no corruption rule can be beneficial. We have actually won contracts because of our policy (although we have lost more than won).

I also try to position our policy in a greater context to our staff. We often have discussions on the ills of corruption and how this negatively affects the development of our country. I explain how we are too good to participate in that game and if any company can have such a stance, it is us. If we can't, how should we expect companies with fewer resources to do so?

This staff by-in is essential to make the policy work. They are on the front-lines and are getting the push back. They lose deal after deal as a result. If they do not firmly believe we are doing the right thing, then we cannot succeed.

2. I am always ready to walk away from a deal

Sometimes, the corruption is more insidious. You think that you are dealing with people with integrity and you proceed with the proposal with that in mind. At some point, even far down the line, some clients become strange. There are unforeseen delays; they are having personal financial issues; the client boss wants to meet the supplier boss in person... There are a number of signs that point to clients wanting you to come forward with an offer for a bribe. When I see such signs, I just walk away. It is just better that way. If they want a bribe at the proposal stage, even if you get around that somehow, they will get you at the payment stage. Just not worth it. We lose lots of deals this way.

3. I try to maintain relationships unrelated to deals or services

The best time to offer a gift to a client or a government official is when you don't need them for anything. Even here you need to be careful with the gift so that it is not misconstrued. I will personally select a book or other inexpensive item that is of personal interest to the person receiving it. People love pens. We had some nice logo pens made and we give them out as gifts. If there is a deal on the table, no pen. This is simply because some clients might interpret this as an incentive and the beginning of bigger and better things. When you don't follow the pen with a more significant "gesture" they see this as an insult.

Another present people just love is Obama gear. So I brought some back after the inauguration and they were thrilled.

I am not a phone person. I hate the phone but I do try to call government officials from time to time just to say hello. People really appreciate this. I prefer email so when I know that they read their email, I will send a quick hello from time to time.

Another one of my favorite gifts is prepaid phone cards. This is not expensive and people really appreciate it. I usually tell them that I would love to hear from them from time to time but that I know it is expensive for them to call. They still "beep" -- beeping is calling briefly to let their number appear on your caller-ID and then hanging up before you pick up as a sign for you to call since only the caller pays -- but they will often do so to give heads up on a matter of interest to you.

4. Do Say Thank You (and not just with words)

There have been times when people have gone out of their way to help us. This is both in the business sector and in government. Although this is not allowed in the US, we do sometimes say thanks by offering a gift, sometimes even cash. (I know!!! Not me!!!). This is very delicate and has to be done very carefully. First, this can only happen if there is no expectation of any type. If there is an expectation, then it can't work and you get caught up in the game.

Second, it must be separated in time enough from the act that it is not seen to be a pay-for-play deal. Let me give you an example. Court judgments here take sometimes months to get typed up and registered. Until that happens, you just can't execute. We had some a judgment that we needed typed. The court clerk, who had been very friendly with us offered to stay after hours to type it. He said that this was because he had followed the case and really felt bad for us. No expectation. More than a year later, I purchased a cell phone and gave it to that Clerk. It was my way to say thank you. I am his hero now.

Third, this is usually only for lower level staff that are not implicated in the decision-making. This is a secretary, or a security guard, or a similar position where they assisted you in making something happen faster or giving you pointers. For example, with one client, there was a guy working in the IT department with no real title. The guy really liked our solution but he was not part of the decision-making process and had no authority. In fact, he knew from working with that agency, that we would never be selected. He gave us a few tips on how to make sure that our proposal got to the right people so that the decision-makers would be forced to explain why we had not been considered. Using his advice, we won. Well after the project was done and over with, we thanked him with a cash gift. He was getting ready to leave the agency and try to set something up on his own. The cash was what he needed.

There are even times when we have provided a gift to a decision-maker (I know... I know, digging deeper into the mud). This happened twice. In both instances, they were no longer in their capacity when we "thanked" them. They were very surprised and very grateful. And in both cases, they had really helped us a great deal, even at personal cost when everyone else seemed against us. Each time also, they never asked for anything or acted in a manner which led us to believe they had any ulterior motive.

I know a lot of people will say that it is a form of corruption. I struggle with it myself to be very honest. I worry that the recipients of the gift might expect us to do this every time. We have not run into many problems but it is still a concern.

5. Little Corruption is Big Corruption

One of the most annoying type of corruption in this country is what they call the "mange-mille" which translates as "eat-1,000." These are the police who are on the side of the road and will harass you until you give them the equivalent of $2 or more. I have sat in my car for over an hour refusing to give in before they finally let me go. Once, they stopped me and when they saw I had all my documents, they asked for my yellow-fever vaccination certificate. Believe it or not, I had it with me much to their displeasure. Another time, they wanted to cite me for having a suitcase in the back seat. They said that this required a special license to carry mixed cargo (people and goods). I refused to pay. I missed my plane.

This is such an annoyance that most people just pay. What I find though is that once you start justifying the bribe with "it saves me time" arguments, it becomes easier to use those same arguments when the stakes are higher. I know lots of fellow Diasporans who returned to this country with the same "no corruption" philosophy. Then they gave into the police to avoid the hassle; pretty soon it was the customs officials at the airport to avoid paying custom duty; then they started to justify paying the phone company technicians to install a line faster; and then it goes on and on and on... Within a year, they are fully in the system.

6. Be Beyond Reproach

You can't very well complain about police harassment when your papers are not in order; can't complain about courts being unfair when you are on the wrong ; can't complain about tax authorities when you don't pay your taxes.

As a result, you have to ensure that you are always on the right side of the law. In this country, dual-citizenship is not allowed. I have a US passport. I could get one from this country in a day. But that would set me up for being in an irregular situation. Therefore, I apply for and pay $500 for a residency permit every two years. All our employees, including our cleaning staff and security guards are registered with the government. We cover all their withholdings so that their net salary is what it would have been had they been paid under the table. We file our tax returns
monthly no matter what, even when we can't pay them right away. If we are in a legal dispute and we are wrong, we settle. Sometimes even when we are right we try to settle because Court in this country is HELL (see justice heading for more on that).

The beauty of being beyond reproach is FREEDOM. It is wonderful. We are certainly poorer in financial terms for it but nothing can match the feeling of being FREE. I sleep well at night. My conscience is clear and I know that I am doing my part, as small as it might be, to try to make this country a better place.

3 comments:

  1. Ah you've started posting again. Looking forward to read what you have to say.

    Best of luck.

    ReplyDelete
  2. Mate, I'm happy that you succeeded in the states and went back to our motherland to do the same there. I am trying to do something similar. I've recently started a Private Equity(PE) frim here in the states and could use much help locating as much African business owners in the continental US as possible. My firm is VeraDaniel & Co. (www.veradaniel.com) and I can be reached at e.esochaghi@veradaniel.com. If you can, check out the "Investment Criteria" page on the site. Any leads to finding companies that meet that criteria would be very much appreciated. Much success and God bless.

    ReplyDelete
  3. Great blog. As a current Peace Corps volunteer in Cameroon struggling with the intricacies and challenges of development, in spite of the best efforts of mismanaged donor aid and broken government institutions to kill off any chances of sustainable development, this blog helps me realize that I'm not alone. Although it's quite clear that as a business owner operating in a country of ridiculously corrupt and inefficient tax regime and other structures, you're struggle is far greater and more frequent than mine...

    ReplyDelete

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